feautures of job costing

Idle Time Variance – meaning and formula.

Idle Time Variance – This variance is the standard cost of actual time paid to workers for which they have not worked due to abnormal reasons. The Reasons for idle time may be power failure, defect in machinery, and non supply of materials, etc. Idle time variance should be segregated from the labour efficiency variance otherwise it will show inefficiency on the part of workers though they are not responsible for this. Idle time variance is always adverse and needs investigation for its causes. This variance is calculated as:

Idle Time Variance=Idle Hours x Standard Rate

7 thoughts on “Idle Time Variance – meaning and formula.”

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